Imagine a world where AI systems can understand and interact with the physical world around them, not just process and generate text. Welcome to the era of world models, where AI is shifting from predicting language patterns to simulating real-world environments. Yann LeCun, a renowned AI expert, has just left Meta to bet €500 million on the success of AI that understands physics instead of language. His startup, AMI Labs, is raising funds at a €3 billion valuation and is targeting applications in robotics, autonomous vehicles, and spatial reasoning.
## The World Model Revolution
World models are neural networks that learn how the physical world works by watching video, digesting simulation data, and absorbing spatial inputs. Unlike language models, which excel at statistical text patterns, world models simulate physics. The key difference lies in their architecture, which splits into three parts: a vision encoder, a recurrent neural network, and a controller. This setup achieves 50 to 100 times better sample efficiency than traditional reinforcement learning.
The industry’s elite has already pivoted from large language models to world models. Fei-Fei Li launched a commercial world model in November, while General Intuition raised $134 million in seed funding. Google DeepMind shipped Genie 3 in August, which generates interactive 3D environments from text prompts at 24 frames per second in 720p resolution. LeCun’s AMI Labs is targeting a €3 billion valuation for AI systems that ‘understand physics, maintain persistent memory, and plan complex actions.’
## The 2026 Lineup
LeCun’s AMI Labs will have Alexandre LeBrun, founder of health-tech startup Nabla, as CEO. Headquarters will launch in Paris early this year. The company’s focus on world models marks a significant shift from Meta’s pivot towards LLM-based models. LeCun believes that the next decade belongs to systems that simulate the world, not summarize it. Marble, launched by Fei-Fei Li’s World Labs, is the first commercial world model product. It generates downloadable 3D environments compatible with Unreal Engine and Unity, with pricing starting at free and scaling to $95 per month for 75 generations with commercial rights.
## The Paradigm Shift Is Here
Four major players have entered the world model arena, and the funding is locked. The commercial products are here, and the APIs are already available. World Labs’ Marble offers a free tier for experimentation, while NVIDIA’s API catalog provides access to world foundation models. The Model Context Protocol has 10,000 published servers connecting AI agents to external tools. Use cases are emerging fast, with robotics teams needing spatial planning, autonomous vehicle engineers requiring scene understanding, and game developers wanting procedural 3D world generation. All of them are adopting world models in 2026, not later. LeCun predicts that world models will dominate AI architectures within three to five years. The commercial products are here, and the funding is locked. The race is on.
